NRR Newriver Reit Plc

TIDMNRR

RNS Number : 1264H

NewRiver REIT PLC

23 March 2020

NewRiver REIT plc

("NewRiver" or the "Company")

Impact of Coronavirus (COVID-19) on community pub portfolio

Further to its announcement of 19 March 2020, NewRiver is today providing a further update on the impact of the Coronavirus (COVID-19) pandemic on its business. This follows the UK Government's announcement on 20 March of the temporary closure of entertainment and hospitality premises.

NewRiver's community pub business, Hawthorn Leisure, has closed all its sites with immediate effect. The Company had anticipated pub closures at some stage soon and was therefore well prepared for this outcome.

The Company improved its financial position further at the end of last week to GBP75m of unrestricted cash balances and GBP45m of committed undrawn credit facilities, providing GBP120m of available liquidity. The Company has already undertaken extensive scenario testing, factoring in the loss of income from its pub portfolio, which confirms that NewRiver has significant covenant headroom and a capital structure that is well placed to absorb a prolonged period of uncertainty.

One such scenario in our testing is that the Company does not receive any pub income for the next six months, and a reduced income beyond this, whilst the pub business rebuilds. It also assumes that there is a significant reduction in the Company's retail portfolio income for the next 12 months. In this scenario, the Company's analysis shows that it will have in excess of GBP50 million of cash and GBP45 million of undrawn credit facilities after 12 months. Based on this analysis, the Company is confident that it will remain compliant with its financial covenants for the next 12 months. The Company has no bank or refinancing events until August 2023.

The Company was pleased to note the recent announcements by the UK Government aimed at providing financial assistance to businesses impacted by COVID-19:

-- The UK Government's business rates holiday will apply to the entire pub portfolio, which will save the Company and its tenants an estimated GBP5 million in cash flow over the next 12 months.

-- We are supporting our pub partners and tenants who employ staff to enable them to apply for the Coronavirus Job Retention Scheme, whereby 80% of the wage costs of employees who are unable to fulfil their role due to COVID-19 will be borne by the UK Government.

-- To protect against the possibility that market conditions remain challenging for the next 18 months or more the Company is working with its advisors to apply for the Covid Corporate Financing Facility programme using its Investment Grade credit rating.

We are also currently working with our insurance brokers and insurers to make a claim for the business disruption caused by COVID-19 and for loss of rent.

NewRiver remains a financially sound business with a liquidity position and capital structure that is well placed to absorb a prolonged period of uncertainty. It is worth noting that NewRiver's retail portfolio represented 70% of the Company's net rental income as at 30 September 2019. This portfolio is focused on occupiers in the food & grocery, health & beauty, discounter and essential services sub-sectors, and almost two-thirds of our retail assets are anchored by a major food and grocery brand. Given the fast-changing situation, the Company will provide the market with further updates in due course.

For further information

 
     NewRiver REIT plc                               +44 (0)20 3328 5800 
     Allan Lockhart (Chief Executive) 
      Mark Davies (Chief Financial Officer) 
     Tom Loughran (Head of Investor 
      Relations) 
 
 
                               +44 (0)20 7251 
     Finsbury                   3801 
     Gordon Simpson 
      James Thompson 
 
 

This announcement contains inside information as defined in Article 7 of the EU Market Abuse Regulation No 596/2014 and has been announced in accordance with the Company's obligations under Article 17 of that Regulation. This announcement has been authorised for release by the Board of Directors.

About NewRiver

NewRiver REIT plc ('NewRiver') is a leading Real Estate Investment Trust specialising in buying, managing, developing and recycling convenience-led, community-focused retail and leisure assets throughout the UK.

Our GBP1.3 billion portfolio covers 9 million sq ft and comprises 33 community shopping centres, 25 conveniently located retail parks and over 700 community pubs. Having hand-picked our assets since NewRiver was founded in 2009, we have deliberately focused on the fastest growing and most sustainable sub-sectors of the UK retail market, with grocery, convenience stores, value clothing, health & beauty and discounters forming the core of our retail portfolio. This focus, combined with our affordable rents and desirable locations, delivers sustainable and growing returns for our shareholders over the longer term, while our active approach to asset management and in-built 2.3 million sq ft development pipeline provide further opportunities to extract value from our portfolio.

NewRiver has a Premium Listing on the Main Market of the London Stock Exchange (ticker: NRR). Visit www.nrr.co.uk for further information.

LEI Number: 2138004GX1VAUMH66L31

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